Sky UK Limited (formerly British Sky Broadcasting or BSkyB) is a British telecommunications company which serves the United Kingdom. Sky provides television and broadband internet services and fixed line telephone services to consumers and businesses in the United Kingdom. It is the UK's largest pay-TV broadcaster with 11 million customers as of 2015.[1] It was the UK's most popular digital TV service until it was overtaken by Freeview in April 2007.[2] Its corporate headquarters are based in Isleworth.

Formed in November 1990 by the equal merger of Sky Television and British Satellite Broadcasting, BSkyB became the UK's largest digital subscription television company. Following BSkyB's acquisition of Sky Italia and a majority 90.04% interest in Sky Deutschland in November 2014, its holding company British Sky Broadcasting Group plc changed its name to Sky plc.[3] The United Kingdom operations also changed the company name from British Sky Broadcasting Limited to Sky UK Limited, still trading as "Sky".

The present service can trace its heritage back to 1990, when BSkyB's predecessors Sky Television plc and British Satellite Broadcasting encrypted their respective film channels – Sky Movies and The Movie Channel which required viewers to get decoding equipment and a subscription to watch the channels. After the two companies merged, subscribers could get access to both channels, and later the sports channel Sky Sports also became encrypted.

In the autumn of 1991, talks were held for the broadcast rights for Premier League for a five-year period, from the 1992 season.[4]ITV were the current rights holders, and fought hard to retain the new rights. ITV had increased its offer from £18m to £34m per year to keep control of the rights.[5] BSkyB joined forces with the BBC[6] to make a counter bid. The BBC was given the highlights of most of the matches, while BSkyB paying £304m for the Premier League rights, would give them a monopoly of all live matches, up to 60 per year from the 1992 season. [7] Murdoch described sport as a "battering ram" for pay-television, providing a strong customer base.[8] A few weeks after the deal, ITV went to the High Court to get an injunction as it believed their bid details had been leaked before the decision was taken. ITV also asked the Office of Fair Trading to investigate since it believed Rupert Murdoch's media empire via its newspapers had influenced the deal.[9] A few days later neither action took effect, ITV believed BSkyB was telephoned and informed of its £262m bid, and Premier League advised BSkyB to increase its counter bid.[10]

BSkyB retained the rights paying £670m 1997–2001 deal, but was challenged by On Digital[11] for the rights from 2001–2004, thus were forced to £1.1 billion which gave them 66 live games a year.[12]

Following a lengthy legal battle with the European Commission, which deemed the exclusivity of the rights to be against the interests of competition and the consumer, BSkyB's monopoly came to an end from the 2007–08 season. In May 2006, the Irish broadcaster Setanta Sports was awarded two of the six Premier League packages that the English FA offered to broadcasters. Sky picked up the remaining four for £1.3bn.[13] In February 2015, Sky bid £4.2bn for a package of 120 premier league games across the three seasons from 2016. This represented an increase of 70% on the previous contract and was said to be £1bn more than the company had expected to pay. The move has been followed by staff cuts, increased subscription prices (including 9% in Sky's family package) and the dropping of the 3D channel. There have been warnings that Sky was too desperate to retain premier league football and has, therefore, paid excessively and risked its future.[14]

In September 1993, BSkyB launched Sky Multichannels which was the present digital platform's analogue predecessor. Sky Multichannels was a subscription package that gave access not only to Sky's own channels but also those of third party broadcasters.

The service started on 1 September 1993[15] based on the idea from the then chief executive officer, Sam Chisholm and Rupert Murdoch, of converting the company business strategy to an entirely fee-based concept. The new package included four channels formerly available free-to-air, broadcasting on Astra's satellites, as well as introducing new channels.[16] The service continued until the closure of BSkyB's analogue service on 27 September 2001,[17] due to the launch and expansion of the Sky Digital platform. Some of the channels did broadcast either in the clear or soft encrypted (whereby a Videocrypt decoder was required to decode, without a subscription card) prior to their addition to the Sky Multichannels package.[18][19] Within two months of the launch, BSkyB gained 400,000 new subscribers, with the majority taking at least one premium channel as well,[20] which helped BSkyB reach 3.5 million households by mid-1994. Michael Grade criticized the operations in front of the Select Committee on National Heritage, mainly for the lack of original programming on many of the new channels.[21]

BSkyB's digital service was officially launched on 1 October 1998 under the name Sky Digital, although small-scale tests were carried out before then. At this time the use of the Sky Digital brand made an important distinction between the new service and Sky's analogue services. Key selling points were the improvement in picture and sound quality, increased number of channels and an interactive service branded Open.... now called Sky Active, BSkyB competed with the ONdigital (later ITV Digital) terrestrial offering and cable services. Within 30 days, over 100,000 digiboxes had been sold, which help bolstered BSkyB's decision to give away free digiboxes and minidishes from May 1999.

In addition to most channels from the Sky Multichannels package, Sky Digital launched with several new channels that were exclusive to the digital offer.

The switch-over from analogue to digital proceeded relatively quickly. In Q3 1998, there were 6 million 'multichannel' TV homes in the UK (i.e. homes that watch television other than the traditional analogue terrestrial), and over half of these homes watched television using BSkyB's analogue service. BSkyB's digital service surpassed the analogue service in terms of subscribers in late 1999.[22]

By June 2000 the service had 3.6 million subscribers, which gave BSkyB 8.988 million subscribers across all platforms. This substantial growth reflected BSkyB’s 34% share of viewers in multi-channel homes (up from 13.4% from 1999).[23]

BSkyB's analogue service ended in October 2001, and the digital service would eventually be marketed as just 'Sky'.

By June 2005, the number of digital subscribers increase to 7.8m, while it produced 38,375 hours of sport in 2005[24]

BSkyB's direct-to-home satellite service became available in 10 million homes in 2010, Europe's first pay-TV platform in to achieve that milestone. Confirming it had reached its target, the broadcaster said its reach into 36% of households in the UK represented an audience of more than 25m people. The target was first announced in August 2004, since then an additional 2.4m customers had subscribed to BSkyB's direct-to-home service. Media commentators had debated whether the figure could be reached as the growth in subscriber numbers elsewhere in Europe flattened.[25]

The Daily Mail newspaper reported in 2012 that the UK government's benefits agency was checking claimants' "Sky TV bills to establish if a woman in receipt of benefits as a single mother is wrongly claiming to be living alone" – as, it claimed, subscription to sports channels would betray a man's presence in the household.[26] In December, the UK’s parliament heard a claim that a subscription to BSkyB was ‘often damaging’, along with alcohol, tobacco and gambling. Conservative MP Alec Shelbrooke was proposing the payments of benefits and tax credits on a "Welfare Cash Card", in the style of the Supplemental Nutrition Assistance Program, that could be used to buy only "essentials".[27]

BSkyB initially faced competition from the ONdigitaldigital terrestrial television service (later renamed ITV Digital). ITV Digital failed for numerous reasons, including, but not limited to numerous administrative and technical failures, nervous investors after a large down-turn in the advertising market and the dot com crash, and BSkyB's aggressive marketing and domination of premium sporting rights.

While BSkyB had been excluded from being a part of the ONdigital consortium, thereby making them a competitor by default, BSkyB was able to join ITV Digital's free-to-air replacement, Freeview, in which it holds an equal stake with the BBC, ITV, Channel 4 and National Grid Wireless. Prior to October 2005, three BSkyB channels were available on this platform: Sky News, Sky Three, and Sky Sports News. Initially BSkyB provided Sky Travel to the service. However, this was replaced by Sky Three on 31 October 2005, which was itself later re-branded as 'Pick TV' in 2011.

On 8 February 2007, BSkyB announced its intention to replace its three free-to-air digital terrestrial channels with four subscription channels. It was proposed that these channels would offer a range of content from the BSkyB portfolio including sport (including English Premier League Football), films, entertainment and news.[28] The announcement came a day after Setanta Sports confirmed that it would launch in March as a subscription service on the digital terrestrial platform, and on the same day that NTL's services re-branded as Virgin Media. However, industry sources believe BSkyB will be forced to shelve plans to withdraw its channels from Freeview and replace them with subscription channels, due to possible lost advertising revenue.[29]

BSkyB is facing increased competition from telecommunications providers delivering pay television services over existing telephone lines using ADSL. Such providers are potentially able to offer "triple-play" or "quad-play" packages combining land-line telephone, broadband Internet, mobile telephone and pay television services.

To compete with these providers, in October 2005, BSkyB bought the broadbandInternet Service ProviderEasynet for £211 million. This acquisition allowed BSkyB to start offering a Sky-branded broadband service as well as a "triple play" package combining satellite television, land-line telephone and Broadband service. BSkyB also offers some streaming live TV channels to a computer using Microsoft's Silverlight.[30]

In early 2012, BSkyB released an update to its Sky Anytime service. This update offers customers the chance to buy and rent films from the Sky Store.

On 26 September 2012, BSkyB relaunched its "Anytime+" on-demand-via-broadband service as "On Demand" as the BBC’s iPlayer joined the line-up of channels offering catch-up TV on the company’s Sky+HD box – linked to a router, the signal from which was recorded before viewing. The BBC was making the preceding week’s programmes available alongside ITV, Channel 4’s 4oD, Channel 5 and the partly BBC Worldwide-owned UKTV, as well as BSkyB’s own channels.[31]

On 29 May 2009, it was confirmed that Sky Go would be made available on the Xbox 360.[32] In November 2011 Sony Computer Entertainment struck a deal with BSkyB to bring some of its shows to the PlayStation Store Video Store. Users are able buy individual TV episodes in SD or HD.[33] On 3 December 2014, Sky Go became available on the PlayStation 4, followed by the PlayStation 3 on 29 January 2015.

On 1 March 2013, it was announced that BSkyB would buy O2's and Be's broadband services from Telefónica for £180 million up front plus another £20 million once customers have been transferred. Telefónica said the deal would allow it to concentrate on providing better mobile services, including rolling out 4G.[34]

BSkyB offers superfast broadband using ADSL2+ technology and fibre-optic, which are provided by BTOpenreach.

The first photos of a prototype Sky HD receiver began appearing in magazines in August 2005. BSkyB launched HDTV services in May 2006. All Sky+ HD receivers incorporate a version of Sky+ using a 300GB, 500GB, or 1TB hard drive (of which 160GB, 250GB or 500GB are available to the user) to accommodate the necessary extra data.

Originally Sky launched with a set top box known as the Sky digibox, using the Slogans "What do you want to watch?", "Entertainment your way" and the current slogan "Believe in Better".[35]

In more recent years the Sky+ and Sky+ HD boxes have launched alongside the original box. Sky+ is a digital video recorder with an internal hard drive which allows viewers to 'pause live television' (by switching from a live feed to a paused real-time recording that can be restarted at any point) and schedule programs to record in the future.

BSkyB initially charged additional subscription fees for using a Sky+ PVR with their service; waiving the charge for subscribers whose package included two or more premium channels. This changed as from 1 July 2007, and now customers that have Sky+ and subscribe to any BSkyB subscription package get Sky+ included at no extra charge. Customers that do not subscribe to BSkyB's channels can still pay a monthly fee to enable Sky+ functions. In January 2010 BSkyB discontinued the Sky+ Box, limited the standard Sky Box to Multiroom upgrade only and started to issue the Sky+HD Box as standard, thus giving all new subscribers the functions of Sky+. In February 2011 BSkyB discontinued the non-HD variant of its Multiroom box, offering a smaller version of the SkyHD box without Sky+ functionality.[36] In September 2007, Sky launched a new TV advertising campaign targeting Sky+ at women. As of 31 March 2008, Sky had 3,393,000 Sky+ users.[37]

BSkyB launched its HDTV service, Sky+ HD, on 22 May 2006. Prior to its launch, BSkyB claimed that 40,000 people had registered to receive the HD service. In the week before the launch, rumours started to surface that BSkyB was having supply issues with its set top box (STB) from manufacturer Thomson. On Thursday 18 May 2006, and continuing through the weekend before launch, people were reporting that BSkyB had either cancelled or rescheduled its installation. Finally, the BBC reported that 17,000 customers had yet to receive the service due to failed deliveries.[38] On 31 March 2012, Sky announced the total number of homes with Sky+HD was 4,222,000.[39]

In early 2012, BSkyB released an update to its Sky Anytime service. This update offers customers the chance to buy and rent films from the Sky Store. In June 2012, BSkyB launched a new EPG for Sky+ HD boxes. The update included a new modernised look and improved functionality. As of 1 October 2012, Sky Anytime was rebranded as Sky On Demand which included ITV Player and Demand 5. BBC iPlayer followed in late Autumn with 4oD which changed to All 4 on 30th March 2015, launched in early 2013.[40]

BSkyB began to broadcast programmes in 3D in April 2010. This included new 3D channels, including a Sky Sports 3D and Sky Movies 3D. BSkyB previously experimented with 3D broadcasting by broadcasting an Arsenal vs Manchester United football game live in 3D in nine pubs situated throughout the United Kingdom.[41]

Sky (formerly marketed as Sky Digital) is the brand name for Sky plc's United Kingdom digital satellite television and radio service, which is operated by British Sky Broadcasting Limited. Slogans Sky have used for marketing include "What do you want to watch?", "Entertainment your way" and the current slogan "Believe in Better".[35] Sky has also aired several advertisements featuring characters from Minions and Inside Out.

When Sky Digital was launched in 1998 the new service used the Astra 2A satellite which was located at the 28.5°E orbital position, unlike the analogue service which was broadcast from 19.2°E. This was subsequently followed by more Astra satellites as well as Eutelsat's Eurobird 1 (now Eutelsat 28A) at 28.5°E), enabled the company to launch a new all-digital service, Sky, with the potential to carry hundreds of television and radio channels.[42] The old position was shared with broadcasters from several European countries, while the new position at 28.5°E came to be used almost exclusively for channels that broadcast to the United Kingdom.

New Astra satellites joined the position in 2000 and 2001, and the number of channels available to customers increased accordingly. This trend continued with the launch of Eurobird 1 (now Eutelsat 28A) in 2001. Additionally, some channels occasionally received new numbering — However, in early 2006, the majority of channels received new numbering, with some receiving single digit changes, whilst others received new numbers entirely.

It was the country's most popular digital TV service until it was overtaken by Freeview in April 2007.[2]

Provided is a universal Ku bandLNB (9.75/10.600 GHz) which is fitted at the end of the dish and pointed at the correct satellite constellation; most digital receivers will receive the free to air channels. Some broadcasts are free-to-air and unencrypted, some are encrypted but do not require a monthly subscription (known as free-to-view), some are encrypted and require a monthly subscription, and some are pay-per-view services. To view the encrypted content a VideoGuard UK equipped receiver (all of which are dedicated to the Sky service, and cannot be used to decrypt other services) needs to be used. Unofficial CAMs are now available to view the service, although use of them breaks the user's contract with Sky and invalidates the user's rights to use the card.

BSkyB's standard definition broadcasts are in DVB-compliant MPEG-2, with the Sky Movies and Sky Box Office channels including optional Dolby Digital soundtracks for recent films, although these are only accessible with a Sky+ box. Sky+ HD material is broadcast using MPEG-4 and most of the HD material uses the DVB-S2 standard. Interactive services and 7-day EPG use the proprietary OpenTV system, with set-top boxes including modems for a return path. Sky News, amongst other channels, provides a pseudo-video on demand interactive service by broadcasting looping video streams.

BSkyB utilises the VideoGuard pay-TV scrambling system owned by NDS, a Cisco Systems company. There are tight controls over use of VideoGuard decoders; they are not available as stand-alone DVB CAMs (conditional-access modules). BSkyB has design authority over all digital satellite receivers capable of receiving their service. The receivers, though designed and built by different manufacturers, must conform to the same user interface look-and-feel as all the others. This extends to the Personal video recorder (PVR) offering (branded Sky+).

BSkyB maintains an electronic programme guide (EPG) which provides information about upcoming programmes and a list of channels. Channels available on Sky are assigned a three digit logical channel number which can be entered on a remote control to access the channel and determines in what order channels are listed.

The EPG differs depending on the viewer's location due to limited regional availability of certain channels or conditions relating to their must-carry status. For example, this ensures that viewers get access to the correct BBC or ITV region or that S4C gets a prominent listing in Wales.

All channels are grouped into categories depending on their content. What section of the EPG a channel gets allocated is determined by rules set up by BSkyB.

BSkyB has no veto over the presence of channels on their EPG, with open access being an enforced part of their operating licence from Ofcom. Any channel which can get carriage on a suitable beam of a satellite at 28° East is entitled to access to BSkyB's EPG for a fee, ranging from £15–100,000. Third-party channels which opt for encryption receive discounts ranging from reduced price to free EPG entries, free carriage on a BSkyB leased transponder, or actual payment for being carried. However, even in this case, BSkyB does not carry any control over the channel's content or carriage issues such as picture quality.

In October 2007, BSkyB announced that they would not accept new applications to launch channel on their EPG, citing "very significant memory constraints" on many of its older digiboxes.[43]

In June 2012, BSkyB launched a new EPG for Sky+ HD boxes. The update boasts a new modernised look and improved functionality.

The EPG numbering is altered frequently when new channels launch or receive new numbers. A few times, the EPG has been substantially altered. For example:

In early 2006, most channels received new numbering. This shake-up intended to split up the original ten categories in sixteen. For example, several channels that had been listed under the 'Entertainment' category where split off into a new 'Lifestyle & Culture' category while the 'News & Documentaries' category was split into two. The 'Specialist' category, which had included shopping, dating, gambling, international and adult channels was split into several genres.[44]

Following the integration of Living TV Group into BSkyB in early 2011, several prominent slots were freed up as many channels were closed down. It was, reported Broadband TV News, the biggest reshuffle in EPG positions for over a decade, with MTV, Comedy Central, Universal Channel, Syfy, News Corporation's FX, and 40 HD channels moving to more prominent places.[45]

On 12 July 2011, former Prime Minister, Gordon Brown claimed that BSkyB's largest shareholder - News Corporation - attempted to affect government policy with regards to the BBC in pursuit of its own commercial interests.[46] He went further, in a speech in Parliament on 13 July 2011, stating:

"Mr James Murdoch, which included his cold assertion that profit not standards was what mattered in the media, underpinned an ever more aggressive News International and BSkyB agenda under his and Mrs Brooks’ leadership that was brutal in its simplicity. Their aim was to cut the BBC licence fee, to force BBC online to charge for its content, for the BBC to sell off its commercial activities, to open up more national sporting events to bids from BSkyB and move them away from the BBC, to open up the cable and satellite infrastructure market, and to reduce the power of their regulator, Ofcom. I rejected those policies." [47]

"The company has lots of technological innovation that only a robust entrepreneur could to bring to British society, but it has also often been profoundly anti-competitive. I believe that the bundling of channels so as to increase the profit and make it impossible for others to participate in the market is anti-competitive. I believe that the way in which the application programming interface—the operating system—has been used has been anti-competitive and that Sky has deliberately set about selling set-top boxes elsewhere, outside areas where they have proper rights. If one visits a flat in Spain where a British person lives, one finds that they mysteriously manage to have a Sky box there even though it is registered to a house in the United Kingdom."[48]

Virgin Media (re-branded in 2007 from NTL:Telewest) started to offer a high-definition television (HDTV) capable set top box, although from 30 November 2006 until 30 July 2009 it only carried one linear HD channel, BBC HD, after the conclusion of the ITV HD trial. Virgin Media has claimed that other HD channels were "locked up" or otherwise withheld from their platform,[49] although Virgin Media did in fact have an option to carry Channel 4 HD in the future.[50][51] Nonetheless, the linear channels were not offered, Virgin Media instead concentrating on its Video On Demand service[52] to carry a modest selection of HD content.[53] Virgin Media has nevertheless made a number of statements over the years, suggesting that more linear HD channels are on the way.[49][54][55]

In 2007, BSkyB and Virgin Media became involved in a dispute over the carriage of Sky channels on cable TV. The failure to renew the existing carriage agreements negotiated with NTL and Telewest resulted in Virgin Media removing the basic channels from the network on 1 March 2007. Virgin Media claimed that BSkyB had substantially increased the asking price for the channels, a claim which BSkyB denied, on the basis that their new deal offered "substantially more value" by including HD channels and Video On Demand content which was not previously carried by cable.[56]

In response, BSkyB ran a number of TV, radio and print advertisements claiming that Virgin Media 'doubted the value' of the channels concerned, at first urging Virgin Media customers to call their cable operator to show their support for Sky, and later urging Virgin Media customers to migrate to Sky to continue receiving the channels. The broadcasting regulator Ofcom subsequently found these commercials in breach of their code.[57]

The availability (at an extra charge) of BSkyB's premium sport and movie services was not affected by the dispute, and Sky Sports 3 was offered as a replacement to Sky 1 on many Virgin Media packages. This impasse continued for twenty-one months, with both companies initiating High Court proceedings.[58] Amongst Virgin Media's claims to the court[59] (denied by BSkyB) were that BSkyB had unfairly reduced the amount which it paid to VMTV for the carriage of Virgin Media's own channels on satellite.[60]

The agreements include fixed annual carriage fees of £30m for the channels with both channel suppliers able to secure additional capped payments if their channels meet certain performance-related targets. Currently there is no indication as to whether the new deal includes the additional Video On Demand and High Definition content which had previously been offered by BSkyB. As part of the agreements, both BSkyB and Virgin Media agreed to terminate all High Court proceedings against each other relating to the carriage of their respective basic channels.[62]

In July 2013, the English High Court of Justice found that Microsoft’s use of the term "SkyDrive" infringed on Sky’s right to the "Sky" trademark. On 31 July 2013, BSkyB and Microsoft announced their settlement, in which Microsoft will not appeal the ruling, and will rename its SkyDrive cloud storage service after an unspecified "reasonable period of time to allow for an orderly transition to a new brand," plus "financial and other terms, the details of which are confidential".[63][64] On 27 January 2014, Microsoft announced "that SkyDrive will soon become OneDrive" and "SkyDrive Pro" becomes "OneDrive for Business".[65][66]